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The Growth of Black-Owned Businesses: Entrepreneurship by Necessity

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(NNPA) "I had to make my own living and my own opportunity! But I made it! Don't sit down and wait for the opportunities to come. Get up and make them!" – Madam C.J. Walker, trailblazing African American businesswoman.

There is a silver lining in the dark cloud of the great recession. A new Census Bureau report reveals that from 2002 to 2007 the number of Black-owned businesses in the United States increased by 60.5 percent to 1.9 million – more than triple the national rate. According to Census Bureau Deputy Director, Thomas Mesenbourg, “Black-owned businesses continued to be one of the fastest growing segments of our economy, showing rapid growth in both the number of businesses and total sales during this time period.”

The reasons for this are many, beginning with the long history of African American entrepreneurship in response to poverty, high unemployment, and discrimination. Consider the case of Madam C.J. Walker, the daughter of slaves who, in the early 1900s, turned her dream of financial independence into a hair care and cosmetics business that revolutionized the beauty products industry, created good paying jobs, and made her a wealthy woman and philanthropist.

Like Madam C.J. Walker, many African Americans may have turned to entrepreneurship in the years covered by the Census Bureau study because of high unemployment in our communities. The fact is, Black unemployment never got back down to where it was before the recession in 2001. So in effect, what we are seeing is a bit of entrepreneurship by necessity. There’s also an economic independent streak, particularly among emerging generations in the Black community. Building a business gives great satisfaction and cushions them from the shock of losing jobs because of economic down cycles.

New York State leads the country with more than 204,000 Black-owned businesses, followed by Georgia and Florida respectively. From 2002 to 2007, nearly four in 10 of these businesses operated in the health care and social assistance; and repair, maintenance, personal, and laundry services sectors. The retail trade and health care and social assistance sectors accounted for 27.4 percent of Black-owned business revenue.

The survey also found that in addition to an increase in the number of Black-owned businesses, annual sales increased by 55% to $137.5 billion.

I recently called on federal, state, and local governments to develop a “hyper-focus” on Black- and minority-owned businesses. Every city, county, and state needs to have a plan that focuses on small and minority business. There is a spirit of entrepreneurship out there that needs to be nurtured and energized.

While the Census Bureau report is generally good news, we know that Black businesses still make up only seven percent of all companies and they tend to be smaller and have lower gross receipts than other businesses. Black-owned businesses are also often hampered in their revenue growth by a lack of capital, connections, and contracts.

What I hope this report says loudly and clearly to the investment community is that you are missing an emerging market in the United States. If minority businesses are growing at a faster clip than overall businesses, imagine what the growth rate would be if those barriers were eliminated or lowered. We need the investor community to look at this report and recognize that they are missing an incredible opportunity.

Marc H. Morial is the President and CEO of the National Urban League.

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0 # Guest 2011-02-26 17:38
I just wanted to inform you and your readers of this very important fact – Madame C.J. Walker’s historic company still exists today and has never stopped manufacturing all of the original hair oils! Anyone who visits our website at http://[censored].ma damewalker.net can view and purchase the full product line. The website also contains valuable information about Raymond Randolph’s purchase of the original Madame C.J. Walker Manufacturing Company in 1985 from the Walker Trustees in Indianapolis, Indiana and how his family continues to keep Madame Walker’s “true” legacy alive. Due to our ownership of Madame’s historic company and the historical documents and memorabilia of the company, the Randolph Family can provide the most detailed and historically sound information about Madame C.J. Walker and her company by calling toll free, 866-552-2838 or going to the contact us page of our website. 

Angela Randolph
http://[censored].ma damewalker.net
 
 
0 # Guest 2011-02-24 05:58
Thanks to Marc Morial for citing Madam C. J. Walker as an example for today's entrepreneurs. As Walker's great-great-granddau ghter and biographer, I'm always thrilled and grateful when others are inspired by her story and her role as a philanthropist , arts patron and anti-lynching activist. Today our family proudly keeps her legacy alive through the Walker Theatre Center, a National Historic Landmark in Indianapolis and through the Madam Walker Family Archives of photographs, Walker Company business documents, letters and other personal Walker artifacts in Wash, DC
A'Lelia Bundles
[censored].madamcjwalker.com
[censored].aleliabundles.com
 

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